The Germans probably will stand pat on their refusal to increase troop strength significantly to the NATO mission in Afghanistan. Merkel's unusually harsh public criticism of U.S. financial policy appears to be driven by domestic politics — the chancellor's need to appear tough in advance of September elections.

Obama and Merkel, who arrives Thursday, are in a period of relationship building. She was particularly close to former President George W. Bush despite his administration's alienation from much of Europe over the U.S. war in Iraq.

Obama, who has promised to restore a multilateral, consultative approach to U.S. foreign policy, is wildly popular among Europeans, the German public in particular. He paid a visit to Berlin last summer and drew an estimated 200,000 people to a speech that he gave as a presidential candidate.

The Obamas' Foreign Trips in Photos

The German and American leaders already have met twice, at an April NATO summit in France and again early this month when Obama visited Buchenwald, the Nazi concentration camp, and Dresden, the German city firebombed by Allied forces near the end of World War II.

They are said to have been mutually impressed by the other's pragmatism and non-ideological view of the world, and that should make for a successful session Friday, despite inherent disagreements.

Iran was expected to sit high on the Obama-Merkel agenda. The chancellor has been tough on the Islamic regime for its crackdown on demonstrators who believe the June 12 election was stolen from reformist presidential challenger Mir Hossein Mousavi.

And the German government voiced support for Obama's most recent response to the unrest, in which he condemned regime attacks on protesters and declared himself "appalled and outraged by the threats, the beatings and imprisonments of the last few days."

A senior German official said Obama's statements Tuesday were "in agreement" with his government's expectations. The official was among a group of government representatives who briefed reporters in advance of the Merkel visit. They spoke anonymously to outline German expectations more freely.

On Afghanistan, differences probably will be papered over. The Germans are expressing gratification over Obama's new policies there, applauding his greater emphasis on nation-building and development assistance for the deeply backward country. U.S. officials are believed to have given up on getting more German help in the war, beyond Berlin's recent agreement to send four AWACS surveillance planes and temporarily deploy 300 troops associated with the mission.

Mark Medish, who worked in the National Security Council of President Bill Clinton, said the U.S. handling of the recent change of command in Afghanistan actually showed the Europeans that Washington has given up on seeking greater NATO participation in the fight.

"It's one of the great unreported stories," said Medish, a visiting scholar at the Carnegie Endowment for International Peace.

He said the United States did not consult its NATO partners when Obama decided to replace Gen. David McKiernan with Gen. Stanley McChrystal as commander of the U.S.-led NATO operation in Afghanistan.

"The way the McChrystal appointment was handled showed the Europeans he is not really counting on them," Medish said.

On the global financial crisis, the German briefers said Merkel will be looking for agreement on an "exit strategy," a means of moving toward long-term fixes of the global regulatory system and away from short-term crisis management.

Merkel earlier in the year criticized Obama's decision to throw money at the problem in the U.S. as a rescue measure while paying less attention to improving the regulatory system that let the crisis run out of control in the first place. Obama successfully fought off a European attempt in April to create a super-regulatory body.

"I think they are shooting to be able to come out into the Rose Garden after their meeting and tell the world that there is nothing to all the talk of trouble between them," said Jackson Janes of the American Institute for Contemporary German Studies.

He dismissed as "hogwash" speculation that the two leaders don't like one another.

Janes said Obama stood to benefit greatly from the Merkel meeting as he heads to Moscow early next month for meetings with President Dmitry Medvedev and Prime Minister Vladimir Putin.

"She has a lot of clout with the Russians. She can give him her thoughts on Russian vulnerability. She knows Putin and Medvedev," Janes said, predicting that Obama would be pressing not only on arms control but, more urgently, for Russian help in reining in Iran and its nuclear ambitions.